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India Could Get An AI Index To Rank States On Innovation, Adoption

India Could Get An AI Index To Rank States On Innovation, Adoption

Niti Aayog plans to table an AI index recommendation to the new cabinet

The parameters for the index are yet to be finalised, an official said

Proposal recommends INR 7,500 Cr government investment over three years

Artificial intelligence adoption in India will be a crucial factor when it comes to the future growth of the startup and tech ecosystem. But deeptech funding and innovation have frozen over the past few quarters. Government think tank Niti Aayog is looking to give AI development a shot in the arm with an AI readiness index to rank states on their adoption of AI, as well as their use of AI innovations for public service and governance.

According to Inc42 DataLabs, the deeptech sector, within which AI development is a segment, is struggling to attract high-value investments. In the first quarter of 2019, the deeptech sector recorded a total investment of $9.58 Mn, a mere 1% compared to e-commerce, which received $958 Mn. In fact, the deeptech was the only startup sector in India to receive lower funding than the quarterly average.

Quoting a Niti Aayog official, the Economic Times reports that the AI index would join the commission’s health, education and water composite indices, as well as the agriculture index, in ranking states based on certain key indicators. While the parameters for the index are yet to be finalised, it could take into account the state’s initiatives on AI, the digital skills among residents in the state, degree of innovation among existing startups, data capacity among other factors, the report said quoting an unnamed Niti Aayog official.

The official added that the AI index would help the Aayog recommend areas of improvement for states based on the challenges identified through the ranking process. They added that the commission would soon enter a cabinet note to the government recommending an infusion of INR 7,500 Cr over a three-year period for a high-level AI task force.

Despite government initiatives such as Startup India, Atal Innovation Mission and MUDRA, the growth in Indian deeptech startups leg behind US, European, and Chinese counterparts. One primary reason for this is the lack of monitoring and regulation, which leads to poor or failed execution of these government schemes, or startups not getting the right support at an early stage. The Niti Aayog was tasked with developing a national programme for AI after the Budget 2018-19 and had released the national strategy for AI in June last year. But the hurdles in the growth of AI are not just about a lack of government support.

To promote innovation in advanced technologies such as AI and machine learning (ML), a specialised workforce is a must. While India does have the required talent pool to facilitate breakthrough innovation, the majority of the high-skilled tech workers are working for big corporations in the West.

Secondly, the crop of new engineers from Tier 2 and Tier 3 cities do not have adequate training for modern and emerging technologies when they enter the workforce. Another factor is the strong market presence in AI of global tech giants such as IBM, Google and Microsoft.

However, government support and push for AI could be key as more startups could gravitate towards this sector. Government focus on AI development and innovation could encourage and support startups that would have otherwise passed under the radar.